Ethereum Price Analysis: Here’s What Next for ETH After Getting Rejected at $4K

by

As a seasoned researcher with years of experience navigating the cryptocurrency market, I find myself closely observing Ethereum‘s current position near the $4K mark. Having witnessed numerous price fluctuations and trends, my gut feeling tells me that we are on the cusp of an exciting phase for ETH investors.

The cost of Ethereum is at a crucial point around $4,000, encountering resistance yet also hinting at stabilization. Although the market maintains an optimistic outlook, minor ups and downs within the $3,500-$4,000 band are anticipated before a possible breakout or further decline.

Technical Analysis

By Shayan

The Daily Chart

Ethereum has shown significant advancement, inching closer to the challenging $4,000 barrier – a level that aligns with Ethereum’s peak price for the year and presents a considerable region of selling activity. The refusal at this point has triggered a minor dip, hinting that overcoming this resistance might be tough for buyers.

Following the adjustment, the market experienced a stretch of reduced price fluctuations, indicating a brief phase of consolidation might be underway. This consolidation could persist within the $3,500 to $4,000 price range as both buyers and sellers seem to have reached an impasse. The RSI indicator’s bearish divergence hints at a market that may be overbought, strengthening the possibility of this corrective period continuing.

Despite some initial resistance, Ethereum buyers might soon try to surpass the $4K mark again. Yet, it’s probable that we’ll experience a pause with fluctuating prices as the market takes time to process its recent advancements.

The 4-Hour Chart

On a 4-hour scale, Ethereum exhibits a bullish pattern, repeatedly creating new peaks (higher highs) and troughs (higher lows). Though there was a recent resistance at $4K, the overall direction continues to incline upward, with Ethereum moving inside an upwardly sloping price channel.

After missing the $4,000 resistance point, there’s been a phase of stabilization as the asset remains slightly below this significant marker. The bottom end of the rising trendline, approximately $3,700 at present, offers temporary support. If the price manages to hold this level, it could signal an uptrend aiming for the $4,000 barrier.

On the other hand, a break below the channel’s lower trendline could indicate weakening bullish momentum, with a possible pullback toward the $3.5K support level in the mid-term. However, if buyers manage to defend it, another attempt to break $4K could be imminent.

Onchain Analysis

By Shayan

The Funding Rates indicator on Ethereum, which reflects the futures market’s overall mood, has reached its highest point in months, coinciding with a substantial price increase. This suggests a robust positive outlook among traders, who are expecting new record highs. However, it’s important to note that the market might need a correction to maintain this upward trend.

Currently, funding rates resemble those from January 2024, a time when Ethereum experienced an impressive surge of 88%. This indicates a rise in long-term investment appetite and optimism among investors. As we saw in January, such a sharp uptick might signal an impending correction, giving the market a chance to balance out and prevent excessive volatility.

While Ethereum’s rally is underpinned by bullish sentiment, the spike in funding rates signals the need for a short-term correction, paving the way for healthier and more sustainable price growth.

Read More

2024-12-09 15:20